China's property market has seen a marked uptick in buyer interest and transaction volumes following a fresh round of policy support unveiled in late August.
On August 28, three government departments, including the Ministry of Housing and Urban-Rural Development, jointly issued a circular, calling on local authorities to regulate presale conditions for commercial housing and strengthen supervision of presale funds to ensure funds safety, and advance the sale of completed new homes in an effective and orderly manner.
On the same day, the central bank and the National Financial Regulatory Administration issued opinions on reforming and improving real estate credit management to accelerate the establishment of a new real estate development model.
The new policies have further lowered the threshold for homeownership in Shenzhen City of south China's Guangdong Province, resulting in a surge of 20 percent to 30 percent in inquiries from young buyers over the past weekend.
"We are receiving 50 to 70 groups of potential homebuyers per day over the weekend, and our transaction volume has risen by about 30 percent," said Wu Hejuan, marketing manager of the Hezheng Fangzhou residential project.
The resale market in Shenzhen has also seen increases in both online inquiries and transactions.
"Our online inquiries have grown notably, hitting a peak in months," said Xiao Xiaoping, dean of the Shenzhen Beike Research Institute, a professional real estate market research organization and data platform. "On the first weekend after the new policies were announced, our transaction volume rose by 21 percent over the previous weekend. Especially, Sunday's figure set a new single-day record among all weekends for this year," said Qin Dongzhao, marketing vice president of Leyoujia, a major real estate brokerage and technology enterprise in Shenzhen.
In Beijing, the municipal government introduced a package of measures in early August, raising the housing provident fund loan cap for couples who both contribute to the fund. The maximum loan amount doubled to 2.4 million yuan (about 350,000 U.S. dollars) for first-home purchases and 2 million yuan for second-home purchases.
For a Beijing resident identified only as Liu, who is looking to purchase a new apartment worth about 5 million yuan in E-Town, the provident fund loan cap has been raised by 1 million yuan, allowing him to aim for a larger home as provident fund loans offer significantly lower interest rates than standard commercial mortgages.
"As we can loan more from the housing provident fund, we can look at bigger, more functional homes without compromising our quality of life," he said.
In Shanghai, multiple sales offices and agency stores reported faster purchase decisions among hesitant buyers within a week of the new measures.
"Our sales and transaction data have risen steadily, up about 50 percent. The average time between homebuyers' initial property visit and the signing of the final contract has shortened from the previous six months to about three months," said Wang Na, sales manager of Huafa Haishang Duhui, a local residential project. Meanwhile, Wuhan, capital of central China's Hubei Province, introduced a new housing policy on Friday, offering a 1-percent subsidiary or discount on the total contract price for families purchasing newly-built homes, with a total pool of 100 million yuan on a first-come, first-served basis.
"The sales agent's calculation suggests a cut of 50,000 yuan off the total price. I think it's a great deal, so I will probably buy very soon," said Ms. Liang, a prospective buyer in Wuhan.
New property policies boost home sales in major Chinese cities
